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Advice You - Practical Accounting 3
BUDGET SETTING
This is the single most neglected feature in any organisation.
Yet without setting budgets we have no goal posts through which to kick the ball!
As in sport, we should always strive to st
This is the single most neglected feature in any organisation.
Yet without setting budgets we have no goal posts through which to kick the ball!
As in sport, we should always strive to st
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
retch our limits. Thus Sales Budgets provide the impetus that drives the whole venture.
We all need some yard stick by which to determine what pricing to put on to a product or service that we sell.
It is often
We all need some yard stick by which to determine what pricing to put on to a product or service that we sell.
It is often
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
easy to determine the price that we pay for an item that we purchase – just look at the invoice!
However, not even this is always so easy. Do we buy it from Supplier “A” or Supplier “B”. Which gives the best pr
However, not even this is always so easy. Do we buy it from Supplier “A” or Supplier “B”. Which gives the best pr
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
ice, then do either offer better pricing for bulk buys? Again, once we have set a realistic Sales Budget, then we can determine our quantity requirements in order to meet those sales. Possibly, on that basis we c
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
an negotiate better buying prices.
If we are buying multiple components to manufacture something then the number of questions begin to increase.
The next questions that then arise are quality of components, and
If we are buying multiple components to manufacture something then the number of questions begin to increase.
The next questions that then arise are quality of components, and
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
suitability of combining one with another. What about wastage – can we afford to either scrap or re-work components?
What effect does re-work have on labour costs?
In a previous Practical Accounting Article we
What effect does re-work have on labour costs?
In a previous Practical Accounting Article we
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
touched on Costing Theory. This also discussed the need to allocate indirect costs against the provision of a manufacturing process, or the provision of a service.
Probably, by now you begin to see the need for
Probably, by now you begin to see the need for
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
budgets as they can be used to assist in the costing exercise.
Where the volume of sales is somewhat consistent between one year and another then the historical figures can be adjusted to allow for the anticipa
Where the volume of sales is somewhat consistent between one year and another then the historical figures can be adjusted to allow for the anticipa
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
ted sales next period. These then become the budget for the that period.
Most of the SME accounting packages have some provision for comparing actual performance against budget. One program in the market place h
Most of the SME accounting packages have some provision for comparing actual performance against budget. One program in the market place h
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
as a button you press that takes the actual figures into a popular spreadsheet so that changes can be made on the basis of “what if”. Unfortunately, it is not so easy to take the figures back into the program – t
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
hey have to all be manually keyed!
The accounting program that I promote allows selection of figures by copy and paste either way. This does require discipline. The order of the figures being pasted back into th
The accounting program that I promote allows selection of figures by copy and paste either way. This does require discipline. The order of the figures being pasted back into th
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
e budget column must not be changed in order to achieve synchronisation with the “Actual” figures. Fortunately, the “Actual” figures can not be corrupted.
Now when a budget has been set-up in an accounting progr
Now when a budget has been set-up in an accounting progr
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
am, it is easy to compare Actual against Budget in the reports that can be generated.
Sometimes you will note that there are seasonal fluctuations in both Actual and in Budget figures. When they diverge there ca
Sometimes you will note that there are seasonal fluctuations in both Actual and in Budget figures. When they diverge there ca
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
n sometimes be explanations such as unseasonal weather patterns. This was very obvious with one grocery chain I was involved with, and at Board meetings the financial reports were often supplemented with weather
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
bureau reports explaining the deviations from anticipated results. Similarly, changed Public Holiday dates could also affect sales and were reported on when applicable.
Changes in operations can also affect the
Changes in operations can also affect the
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
performance. That is, if a business is expanding then economies of scale can assist in reducing purchase prices.
Conversely, if additional capital outlays are required in order to provide capacity for the increa
Conversely, if additional capital outlays are required in order to provide capacity for the increa
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
sed throughput, then there would be borrowing costs (either actual or implied). In addition, neglecting tax scheduled depreciation we should provide for the ultimate replacement of assets at “tomorrows dollars” r
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
ather than historical purchase prices.
Obviously, lending authorities need to see projected figures (sometimes years ahead) as well as reports on past performance before they will risk lending for any proposed e
Obviously, lending authorities need to see projected figures (sometimes years ahead) as well as reports on past performance before they will risk lending for any proposed e
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
xpansion.
Government funded bodies such as the nine South Australian Business Enterprise Centres (bec), and fourteen South Australian Regional Centres conduct courses in which one of the final products is a Busi
Government funded bodies such as the nine South Australian Business Enterprise Centres (bec), and fourteen South Australian Regional Centres conduct courses in which one of the final products is a Busi
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
ness Plan for each participant.
Even the operators of established businesses should re-visit their Business Plan from time to time, and make changes in response to perceived public demand for product or service.
Even the operators of established businesses should re-visit their Business Plan from time to time, and make changes in response to perceived public demand for product or service.
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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